Jump to content
House Price Crash Forum
Sign in to follow this  
Realistbear

Eurozone Debt Crisis About To Return As Fix Wears Off?

Recommended Posts

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8021463/Ireland-faces-double-dip-mulls-restructuring-of-junior-bank-debt.html

Ireland faces double dip, mulls restructuring of junior bank debt
Irish borrowing costs have surged to a post-EMU record after Ireland's recovery buckled over the summer and Dublin said creditors of Anglo Irish Bank may be asked to "share" losses, a warning to bondholders that the dam may at last be breaking on debt restructuring in the eurozone....../
The Irish upset came as the PMI purchasing managers index for eurozone fell sharply in August. Manufacturing orders fell to the lowest in 14 months. The German PMI fell to an eight-month low of 54.8, a sign that Germany's mini-boom is losing steam. "This data has marked slowdown written all over it," said Martin van Vliet from ING.
Spreads on Ireland's 10-year bonds have risen to 405 basis points. Gavan Nolan from Markit said credit default swaps measuring bond risks on Irish banks are nearing the levels of Icelandic banks shortly before they defaulted two years ago, reaching 955 for Anglo Irish (senior debt), 615 for Allied Irish and 530 for Bank of Ireland.
Spee-un too:

http://www.bloomberg.com/news/2010-09-23/spain-faces-pressure-to-keep-up-austerity-as-euro-s-periphery-bonds-drop.html' rel="external nofollow">
Zapatero is trying to show he can rein in the euro region’s third-largest budget deficit and revive an economy that’s just emerging from a recession that started in the second quarter of 2008. His task has become more urgent as doubts resurface about high-deficit euro members’ ability to get their finances under control. The perceived riskiness of Portuguese and Irish bonds rose to euro-era records yesterday.
At 183 basis points, the extra yield that investors demand to hold Spanish 10-year bonds over German bunds is more than twice what it was last year. The so-called spreads on Irish and Portuguese bonds yesterday touched 417 points and 400 points respectively.

The Eurozone debt crisis did appear to vanish without pain or even a blip on the currency markets with the Euro seeing massive gains in recent weeks. Could the fix of a few billion be wearing off in the wake of the grim reality of the double dip (that began in the US)? Is the smoke and mirrors illusion finally blowing away?

Edited by Realistbear

Share this post


Link to post
Share on other sites

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8021463/Ireland-faces-double-dip-mulls-restructuring-of-junior-bank-debt.html

Ireland faces double dip, mulls restructuring of junior bank debt
Irish borrowing costs have surged to a post-EMU record after Ireland's recovery buckled over the summer and Dublin said creditors of Anglo Irish Bank may be asked to "share" losses, a warning to bondholders that the dam may at last be breaking on debt restructuring in the eurozone....../
The Irish upset came as the PMI purchasing managers index for eurozone fell sharply in August. Manufacturing orders fell to the lowest in 14 months. The German PMI fell to an eight-month low of 54.8, a sign that Germany's mini-boom is losing steam. "This data has marked slowdown written all over it," said Martin van Vliet from ING.
Spreads on Ireland's 10-year bonds have risen to 405 basis points. Gavan Nolan from Markit said credit default swaps measuring bond risks on Irish banks are nearing the levels of Icelandic banks shortly before they defaulted two years ago, reaching 955 for Anglo Irish (senior debt), 615 for Allied Irish and 530 for Bank of Ireland.

The Eurozone debt crisis did appear to vanish without pain or even a blip on the currency markets with the Euro seeing massive gains in recent weeks. Could the fix of a few billion be wearing off in the wake of the grim reality of the double dip (that began in the US)? Is the smoke and mirrors illusion finally blowing away?

iirc i showed you that the commercials had gone 2:1 long on the euro vs usd three months ago when it was languishing around 1.20, i also recall you disagreed with the analysis

Share this post


Link to post
Share on other sites

iirc i showed you that the commercials had gone 2:1 long on the euro vs usd three months ago when it was languishing around 1.20, i also recall you disagreed with the analysis

If the "news" is accurate and was foreseen the Euro should have been shorted. The recent run-up has been based on a massive publicity campaign in the EZ to the effect that:

1. Its contained

2. The recovereh is locked in.

3. The EZ is decoupled from the US

None of the above are true and I suspect the cracks that are now forming underscore that state of affairs. The currency traders are working on the "spotlight" trading method. You buy whatever currency is in favour regardless of fundamentals and the spotlight right now is on the $ having been on the Euro for the early part of the year. Next will come the Pound and many of the larger traders have been ponting to a sell off in Sterling later this year. Irrational? Probably so as the FOREX is by far the world's largest Casino.

Share this post


Link to post
Share on other sites

iirc i showed you that the commercials had gone 2:1 long on the euro vs usd three months ago when it was languishing around 1.20, i also recall you disagreed with the analysis

let us know when the reverse is true!... 1.34 atm, the market seems to be more worried about the size of QE2 in the US than the unfolding mess in the EZ.

Share this post


Link to post
Share on other sites

If the "news" is accurate and was foreseen the Euro should have been shorted. The recent run-up has been based on a massive publicity campaign in the EZ to the effect that:

1. Its contained

2. The recovereh is locked in.

3. The EZ is decoupled from the US

None of the above are true and I suspect the cracks that are now forming underscore that state of affairs. The currency traders are working on the "spotlight" trading method. You buy whatever currency is in favour regardless of fundamentals and the spotlight right now is on the $ having been on the Euro for the early part of the year. Next will come the Pound and many of the larger traders have been ponting to a sell off in Sterling later this year. Irrational? Probably so as the FOREX is by far the world's largest Casino.

Hilarious, there is no should have other than your interpretation of the news, this is the whole point of your pointless highlighting news articles and then deciding the market is wrong or right based on your interpretation.

Your interpretation is irrelevant, as is any other single entities interpretation. If the market doesnt go the way you expect, there is no should have you are just wrong, the market direction is alway right, it cant not be because for it to move the other way there is by definition more money which disagrees with you than agrees

Edited by Tamara De Lempicka

Share this post


Link to post
Share on other sites

The Eurozone debt crisis did appear to vanish without pain or even a blip on the currency markets with the Euro seeing massive gains in recent weeks. Could the fix of a few billion be wearing off in the wake of the grim reality of the double dip (that began in the US)? Is the smoke and mirrors illusion finally blowing away?

They were buying the Euro like Crazy when everyone knew about the PIIGS and their associated problems, when it finally blew they sold the hell out of it. Looks like the same is happening all over again. Sterling is also now loosing ground against the Euro.

Note to self: Next time PIIGS blow short the hell out of the Euro...

Share this post


Link to post
Share on other sites

let us know when the reverse is true!... 1.34 atm, the market seems to be more worried about the size of QE2 in the US than the unfolding mess in the EZ.

Merv has indicated that QE2 will soon be setting sail on the choppy waters of our economy ( :D ) and the mess in the EZ reported this morning suggests more of the same there.

The West is broke and needs to relax in a deflationary spiral to allow the rest of the toxic air to escape from the bubbles that are going to deflate in any event no matter how many billons are pumped in. There are just too many holes in the economic structures to hold the air in.

Share this post


Link to post
Share on other sites

Hilarious, there is no should have other than your interpretation of the news, this is the whole point of your pointless highlighting news articles and then deciding the market is wrong or right based on your interpretation.

Your interpretation is irrelevant, as is any other single entities interpretation. If the market doesnt go the way you expect, there is no should have you are just wrong, the market direction is alway right, it cant not be because for it to move the other way there is by definition more money which disagrees with you than agrees

In today's economy I would agree with you. The market moves contrary to fundamentals because it is being manipulated to do so. The problem with artificial market manipulation is that there is always a payback as you NEVER beat the market in the LT.

Fundamentals always win. The question is only when.

The only play that has been rational, IMO, is bonds. I stocked up on US Treasuries over the last year or so and have done quite well. The Euro did tank as predicted (as did £) but what I did not quite foresee was the rebound based on the fix. IMO, it a buy and hold for the $ as it may take a few months for the fundamentals to re-assert themselves and send the Euro back down. If the PIIGS explode (again) its parity with the $ IMO.

Edited by Realistbear

Share this post


Link to post
Share on other sites

In today's economy I would agree with you. The market moves contrary to fundamentals because it is being manipulated to do so. The problem with artificial market manipulation is that there is always a payback as you NEVER beat the market in the LT.

Fundamentals always win. The question is only when.

The only play that has been rational, IMO, is bonds. I stocked up on US Treasuries over the last year or so and have done quite well. The Euro did tank as predicted (as did £) but what I did not quite foresee was the rebound based on the fix. IMO, it a buy and hold for the $ as it may take a few months for the fundamentals to re-assert themselves and send the Euro back down. If the PIIGS explode (again) its parity with the $ IMO.

I hear this so often "the market is being manipulated", it is merely a replacement for my analysis was wrong.

In fact i have a private bet that if Gold starts falling all that will be heard is its not my mistake, its manipulation. Any purchase or sale is a purchase or sale whoever makes it, whether people want to describe it as manipulation or cornering or price fixing or PPT or anything else those trades are part of the market therefore they are the market as much as anything else

Edited by Tamara De Lempicka

Share this post


Link to post
Share on other sites

let us know when the reverse is true!... 1.34 atm, the market seems to be more worried about the size of QE2 in the US than the unfolding mess in the EZ.

i will try to ;)

i got the original snippet of info from Stewart Thomsons blog; this weeks piece has quite a lot of USD technical analysis on it (gold phobics beware, he likes the yellow metal - yet from a neutral perspective his writing is very informative re. forex)

Share this post


Link to post
Share on other sites

I hear this so often "the market is being manipulated", it is merely a replacement for my analysis was wrong.

In fact i have a private bet that if Gold starts falling all that will be heard is its not my mistake, its manipulation. Any purchase or sale is a purchase or sale, whether people want to describe it as manipulation or cornering or price fixing or PPT or anything else those trades are part of the market therefore they are the market as much as anything else

Every action has a counteraction applies to economics as it does physics. The only "proof" is the result which is why hindsight is always 100% accurate. The problem is in the predicting of events over the long term. I believed in, and placed bets on, the collapse of the Euro and Sterling this year based on fundamentals (sneeze:flu phenomena and Hegelian conclusions). So far so good. However, what I* did not foresee was the rapidity of the recovery and the degree to which the EZ and the BoE woud be able to cover over the cracks.

Hindsight is a wonderful thing and I suspect we would all like to be able to have 100% accuracy in predicting the markets but then it would not be a market would it?

____________________

*I suspect hardly anyone foresaw the "recovereh" and containment kick in so quickly--you among them I suspect?

Share this post


Link to post
Share on other sites

i will try to ;)

i got the original snippet of info from Stewart Thomsons blog; this weeks piece has quite a lot of USD technical analysis on it (gold phobics beware, he likes the yellow metal - yet from a neutral perspective his writing is very informative re. forex)

http://www.kitco.com/ind/Thomson/aug252009.html

Writing in August 2009, Stewart "Stu" Thomson made a very bad call on the $ as the reverse happened this year. Stu's call for 6500 on the Dow is still possibe this year--but likely?

He relies on oscillators too much and ignored fundamentals over the longer term IMO.

Predicting currencies ST or even MT seems to be harder than predicting the weather more than 4 days ahead. BBQ summers and all that.

Share this post


Link to post
Share on other sites

Every action has a counteraction applies to economics as it does physics. The only "proof" is the result which is why hindsight is always 100% accurate. The problem is in the predicting of events over the long term. I believed in, and placed bets on, the collapse of the Euro and Sterling this year based on fundamentals (sneeze:flu phenomena and Hegelian conclusions). So far so good. However, what I* did not foresee was the rapidity of the recovery and the degree to which the EZ and the BoE woud be able to cover over the cracks.

Hindsight is a wonderful thing and I suspect we would all like to be able to have 100% accuracy in predicting the markets but then it would not be a market would it?

____________________

*I suspect hardly anyone foresaw the "recovereh" and containment kick in so quickly--you among them I suspect?

I dont see the govt action as manipulation, they are just part of the market, they always have been and always will be, you cant highlight their manipulation now and ignore the manipulation through laws and inflation of the previous 30 years or 100 years, so in reality nothing has changed as far as market participants with what the govt has or hasnt done

Edited by Tamara De Lempicka

Share this post


Link to post
Share on other sites

http://www.kitco.com/ind/Thomson/aug252009.html

Writing in August 2009, Stewart "Stu" Thomson made a very bad call on the $ as the reverse happened this year. Stu's call for 6500 on the Dow is still possibe this year--but likely?

He relies on oscillators too much and ignored fundamentals over the longer term IMO.

Predicting currencies ST or even MT seems to be harder than predicting the weather more than 4 days ahead. BBQ summers and all that.

whether or not ST is right or wrong is not my concern, i am reading his blog for useful info such as this which was not opinion it was fact.

and the fact of the matter is, the euro has rallied since then, contrary to the spin you were flooding the boards with at the time

Share this post


Link to post
Share on other sites

whether or not ST is right or wrong is not my concern, i am reading his blog for useful info such as this which was not opinion it was fact.

and the fact of the matter is, the euro has rallied since then, contrary to the spin you were flooding the boards with at the time

This is true. Things usually always go back up after a crash. As we all know, It had its collapse earlier (my "spin" along with the volumes of bearish articles on the Euro did cause the Euro to drop--but with good cause given the circumstances ) and the big question for the traders is what NEXT? Who is willing to take a shot at a forecast now and place bets accordingly?

I am a LT Euro bear because I see the entire EZ edifice as an artificial concoction put together to satisfy French arrogance with the Germans tagging along because they see how it could become "their" currency. The horrific imbalances which are still emerging in the spreads will eventually be its undoing IMO--at least an undoing in the sense of a USE ever being a reality.

Share this post


Link to post
Share on other sites

This is true. Things usually always go back up after a crash. As we all know, It had its collapse earlier (my "spin" along with the volumes of bearish articles on the Euro did cause the Euro to drop--but with good cause given the circumstances ) and the big question for the traders is what NEXT? Who is willing to take a shot at a forecast now and place bets accordingly?

I am a LT Euro bear because I see the entire EZ edifice as an artificial concoction put together to satisfy French arrogance with the Germans tagging along because they see how it could become "their" currency. The horrific imbalances which are still emerging in the spreads will eventually be its undoing IMO--at least an undoing in the sense of a USE ever being a reality.

actually most of the Euro Drop happened long before bearish articles came out (this is always the way because sentiment follows the market)

By the time their were daily articles on the end of the Euro, i rember a particular classic at 1.19 it was exactly the time to buy, because as always strong sentiment in the direction of the prior move signals exhaustion.

I dont know about your personal positions but it has been noted on here by a number of posters that the timing of your articles almost always coincides with the exact opposite happening, in alot of ways you are almost the perfect contrarian indicator, i dont know whether this is done on purpose but like i say im not the only one whos noticed

Edited by Tamara De Lempicka

Share this post


Link to post
Share on other sites

Irrational? Probably so as the FOREX is by far the world's largest Casino.

I'm struggling to think of a less productive economic activity than people selling fiat currencies to each other.

I mean, digging holes and filling them up again at least gives people healthy exercise.

Share this post


Link to post
Share on other sites

actually most of the Euro Drop happened long before bearish articles came out (this is always the way because sentiment follows the market)

By the time their were daily articles on the end of the Euro, i rember a particular classic at 1.19 it was exactly the time to buy, because as always strong sentiment in the direction of the prior move signals exhaustion.

I dont know about your personal positions but it has been noted on here by a number of posters that the timing of your articles almost always coincides with the exact opposite happening, in alot of ways you are almost the perfect contrarian indicator, i dont know whether this is done on purpose but like i say im not the only one whos noticed

All so true. I guess the next play is to wait for "the dollar is doomed" stuff in the financial pages (maybe just after QE2 is announced) and then sell EUR/USD (preferrably on a decent spike) and then wait and don't panic out at the first sign of trouble (stop losses are for wimps!).

Share this post


Link to post
Share on other sites

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8021463/Ireland-faces-double-dip-mulls-restructuring-of-junior-bank-debt.html

The Irish economy contracted at a 1.2pc rate in the second quarter, making Ireland the first country since the Great Recession to face a double-dip downturn.

The setback is a blow for hopes that Ireland can slowly grow its way out of debt, and may renew concerns that fiscal austerity without other forms of relief risks tipping the economy into a self-reinforcing spiral.

Ireland has been praised for grasping the nettle early in its debt crisis with public sector wage cuts of 13pc, leading the way for other eurozone debtors in trouble. But the reward for good behaviour has yet to come.

Otmar Issing, a founder of the European Central Bank, told a Berlin forum that the risk of a populist backlash against austerity is growing.

"I think it's a big challenge for responsible parties in the middle of the spectrum to explain to people why these hardships are necessary," he said.

Dr Issing said it would be "suicide" for any country to leave the euro, but it could happen anyway if a state finds itself "in such a disastrous situation that extreme parties get a majority".

A recent poll by the German Marshall Fund found that 55pc of EU citizens now think the euro is a "bad thing".

The Irish upset came as the PMI purchasing managers index for eurozone fell sharply in August. Manufacturing orders fell to the lowest in 14 months. German PMI fell to an eight-month low of 54.8, a sign that Germany's mini-boom is losing steam.

"This data has marked slowdown written all over it," said Martin van Vliet from ING.

Spreads on Ireland's 10-year bonds have risen to 405 basis points. Gavan Nolan from Markit said credit default swaps measuring bond risks on Irish banks are nearing the levels of Icelandic banks shortly before they defaulted two years ago, reaching 955 for Anglo Irish (senior debt), 615 for Allied Irish and 530 for Bank of Ireland.

Will Ireland go the same way as Iceland?

I'm sure it's all contained.....

I'm sure the people will understand all the cuts are necessary because everyone got greedy and you really can't have something for nothing.

Share this post


Link to post
Share on other sites

actually most of the Euro Drop happened long before bearish articles came out (this is always the way because sentiment follows the market)

By the time their were daily articles on the end of the Euro, i rember a particular classic at 1.19 it was exactly the time to buy, because as always strong sentiment in the direction of the prior move signals exhaustion.

I dont know about your personal positions but it has been noted on here by a number of posters that the timing of your articles almost always coincides with the exact opposite happening, in alot of ways you are almost the perfect contrarian indicator, i dont know whether this is done on purpose but like i say im not the only one whos noticed

You may have missed my Crimbo 2009 forecats on Sterling and the Euro? See sig. It pays to observe sometimes.

I was bearish on the Euro months before it bgean to tank. December 2009 in fact.

BTW your forecasts might have been accurate or inaccurate--is there anyway anyone can tell? Neither one way or the other?

Are you a gold bug by chance? <_<

Edited by Realistbear

Share this post


Link to post
Share on other sites

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8021463/Ireland-faces-double-dip-mulls-restructuring-of-junior-bank-debt.html

Will Ireland go the same way as Iceland?

I'm sure it's all contained.....

I'm sure the people will understand all the cuts are necessary because everyone got greedy and you really can't have something for nothing.

No--they cancelled the Irish troubles just a few hours ago: it IS contained:

http://uk.finance.yahoo.com/news/irish-trade-surplus-grows-in-july-afp-d08cf067e180.html?x=0

Irish trade surplus grows in July

13:03, Friday 24 September 2010

Ireland's trade surplus grew 29 percent in July to 42.03 billion euros (56.42 billion dollars) as exports rose and imports fell, official data showed on Friday.

The data comes a day after official figures showed Ireland's economy shrank by a huge 1.2 percent in the second quarter, confounding expectations for a modest rise and stoking fears of a slide back into recession for the indebted eurozone nation.

Share this post


Link to post
Share on other sites

You may have missed my Crimbo 2009 forecats on Sterling and the Euro? See sig. It pays to observe sometimes.

I was bearish on the Euro months before it bgean to tank. December 2009 in fact.

BTW your forecasts might have been accurate or inaccurate--is there anyway anyone can tell? Neither one way or the other?

Are you a gold bug by chance? <_<

As I said to Blubb, it's not the accuracy of the predicition, but the quality of the excuse that counts.

Share this post


Link to post
Share on other sites

As I said to Blubb, it's not the accuracy of the predicition, but the quality of the excuse that counts.

As a wise man once said:

"If the prediction is on target there is no need for excuses."

I agree wholeheartedly and am unanimous in that. <_<

Share this post


Link to post
Share on other sites

As a wise man once said:

"If the prediction is on target there is no need for excuses."

I agree wholeheartedly and am unanimous in that. <_<

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 146 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.